Coinbase has asked the court to dismiss the Securities and Exchange Commission (SEC) complaint against them.
The cryptocurrency exchange argues that it doesn’t offer investment contracts, and the SEC’s claims go against established legal interpretations. The SEC accused Coinbase of violating securities laws, but the exchange’s lawyers claim the agency disregarded its prior interpretations and due process. Paul Grewal, the chief legal officer at the exchange stated that:
“By Ignoring that precedent, the SEC has trampled the strict boundaries on its basic authority set by Congress”
The lawyers also mentioned the XRP lawsuit, in which they rejected a similar investment contract claim. Coinbase’s recent filing challenges the SEC’s Exchange Act allegations, stating that the complaint lacks essential components for an investment contract.
The SEC filed lawsuits against Coinbase and Binance in June 2023, raising concerns about the cryptocurrency sector’s regulatory environment.
Coinbase’s brief comes when US officials and politicians face mounting pressure to clarify cryptocurrency regulations. Coinbase’s second-quarter earnings surpassed Wall Street expectations despite the ongoing legal battle. Nevertheless, the exchange’s stock price has experienced a decline in recent days.
